NATURAL disasters and trade bans have created ideal conditions for Australian vegetable oil producers, as global prices have risen sharply recently.

Following a record value of canola production in 2021–22, reaching $5.8 billion, it is set to fall in 2022-23, though is still projected to be the second highest on record.

Record production reflects very favourable Australian seasonal conditions, while record prices are being driven by a global shortage of supply, with production returning to normal levels in 2022–23.

This is nearly four times the value of production in 2018-19 and 2019-20.

Canola prices are forecast to remain high but will gradually ease as the world supply of canola recovers.

However, if interruptions to fertiliser and energy markets continue into 2022–23, the value of canola production in that period is likely to be to be higher due to elevated canola prices.

The value of canola exports increased 133 per cent to $5.1 billion in 2021–22, reaching record levels.

This is more than double the highest recorded value of exports before 2020–21 and is 223 per cent higher than the 10-year average.

In 2022–23, the value of canola exports is forecast to be the second highest on record, while farmers are planting their winter canola seed crops in the ground now.

The Australian (Kwinana) canola price is forecast to be $772 per tonne in 2022-23, down from the record high of $925 per tonne expected by the end of the financial year, 2021-2022.

This is driven by significantly higher canola supply as Canadian canola production recovers following drought conditions in 2021-2022. 

Over the medium term to 2026-27, the Australian canola price is expected to gradually decrease as world supply of canola continues to increase.

Australian canola production is forecast to be 4.9 million tonnes in 2022–23, which is 32 per cent above the 10-year average, driven by an increase in cropping in response to high prices.

It is anticipated that due to soil moisture levels and the optimistic rainfall outlook for the autumn planting season, yield is also projected to be above average.